The loan term is an important factor to consider when shopping for mortgages. An adjustable rate mortgage is probably a good option if you plan to sell the property or move before the term is over, since you won’t have to worry about rising interest rates. A 15-year fixed rate mortgage may have a considerably higher monthly payments than that on a 30-year mortgage, which means you will be stretching your funds.
The loan balance may not be paid off by the time the term ends. If the mortgage does not amortize during the term, there could be a balance or “balloon payment” which is owed in lump sum afterwards. On the other hand, you may be able to pay off the principal and interest completely before the term ends by making larger monthly payments.